CompSouth, an organization representing competitive local exchange carriers, expressed disappointment Wednesday with the Bush Administration’s decision to not appeal a federal court ruling on phone regulation.

The administration said it would not seek to overturn a federal district court ruling earlier this year which struck down FCC rules designed to encourage competition. The four major telephone service providers, including BellSouth, said the FCC rules forced them to lease facilities at rates that did not recover costs.

“CompSouth is extremely disappointed that the Bush Administration caved in to the political pressure of the Regional Bell Operating Companies including BellSouth in deciding not to participate in appealing,” CompSouth said in a statement.

The group said the decision could lead to higher phone rates.

CompSouth represents ITC DeltaCom, MCI, Access Point, AT&T, NuVox Communications, and several other firms.